News in English

Dry Bulk Under Pressure: A Market Searching for Traction

By Iakovos (Jack) Archontakis

Senior Maritime Strategy Consultant - Chartering Executive & TMC Shipping  Commercial Director

and
Dr. Fotios-Evangelos Karlis
Maritime Executive & Shipping Consultant

The dry bulk market entered the new year on a distinctly cautious footing, with freight rates across all vessel classes struggling to regain pre-holiday momentum. Instead of an early rebound, the sector has been met with a broad-based correction, underscoring how fragile sentiment remains as demand lags behind available tonnage.

Losses over the past month have been substantial, reaching as much as 25% across key segments. Capesize earnings declined by 28.5%, Kamsarmax by 20.3%, Ultramax by 29.5%, and Handysize by nearly 25%. This synchronized pullback dragged the Baltic Dry Index down by 517 points month-on-month, closing at 1,688 on Friday, January 9. The move reflects not a localized slowdown, but a market-wide recalibration driven by muted cargo flows and persistent oversupply.

What follows is a closer look at how the dry bulk landscape evolved across vessel sizes and regions over the past week—revealing pockets of resilience, but little in the way of sustained momentum.

Capesize: Heavy Tonnage, Light Support

The Capesize segment continued to trade under pressure, particularly in the Pacific basin. The benchmark Australia–China iron ore route (C5) softened further, as activity from major mining companies failed to generate enough volume to offset the weight of open tonnage. By week’s end, the C5 assessment slipped to USD 7.86 per tonne, a level that signals limited confidence among charterers and owners alike.

In the Atlantic, conditions were more nuanced. Southern routes out of Brazil and West Africa showed relative firmness, with late-January cargoes commanding a modest premium. February business, however, was concluded at lower levels, highlighting the market’s reluctance to price in sustained strength. Northern Atlantic activity remained subdued, offering little counterbalance.

Route indicators reflected this uneven picture. Brazil–China voyages (C3) closed at USD 20.82 per tonne, while time charter equivalents for Europe–Asia runs (C9) stood at USD 48,390 per day. Transatlantic round voyages (C8) were assessed at USD 28,340 per day—steady, but lacking upward momentum.

Kamsarmax: Gradual Absorption, Tentative Gains

The Kamsarmax market in the Atlantic opened the week with a degree of hesitation, amplified by reduced activity around the Epiphany holiday. As the week progressed, however, cargo volumes increased sufficiently to absorb part of the open tonnage list, allowing freight rates to edge higher across both northern and southern Atlantic routes.

Indicatively, East Coast South America (ECSA) to Far East business was concluded at USD 14,000–16,000 per day, plus a ballast bonus of USD 400,000–600,000 for Asia delivery. Europe–Asia voyages were fixed in the USD 17,000–19,000 per day range, while transatlantic round voyages commanded USD 11,500–13,500 per day, delivery Gibraltar.

In Asia, the market diverged. Northern regions remained sluggish for most of the week, with an abundance of available vessels capping any rate recovery, even as cargo volumes improved toward the end of the period. By contrast, the southern market showed healthier dynamics, supported by increased demand from Indonesia and southern China. Southeast Asia–Far East round voyages were fixed at USD 9,000–11,000 per day, reflecting a more balanced supply-demand equation.

Ultramax: Regional Stability, Global Caution

The Ultramax segment presented a mixed but relatively balanced picture. In Southeast Asia, supply and demand were largely aligned, though overall fixing activity remained limited. Rates for Southeast Asia–Far East voyages settled in the USD 9,000–10,500 per day range.

Further north, the Far East market recorded marginal improvements, driven primarily by cargoes emerging in the North Pacific for the second half of the month. NOPAC round voyages were concluded at USD 9,500–11,000 per day, while Far East–India runs fixed at USD 10,500–12,000 per day. Backhaul business to the Atlantic remained under pressure, with rates of USD 8,000–9,500 per day.

In the Arabian Gulf and West Coast India, the market showed signs of reactivation as market participants returned from the holiday lull. While port delays were reported in parts of the Gulf, demand was sufficient to support modest gains. Ultramax rates for AG/WCI–Far East voyages ranged from USD 12,500–14,000 per day, with short regional trips fixing at USD 11,500–13,000 per day.

Across the Atlantic, the U.S. Gulf started the week on a softer note, hampered by a lack of prompt cargoes and longer waiting times. Transatlantic voyages were fixed at USD 18,500–20,000 per day, while U.S. Gulf–Asia business achieved USD 19,500–21,000 per day. In ECSA, increased vessel availability pushed rates lower, with only Asia-bound cargoes showing slight improvement.

European markets remained broadly unchanged. Despite surplus tonnage, steady demand—particularly for scrap cargoes—helped prevent further erosion. Local round voyages were fixed at USD 14,000–15,500 per day, while scrap shipments to the Mediterranean achieved USD 17,500–19,000 per day.

Handysize: Oversupply Weighs on Sentiment

The Handysize sector faced persistent pressure, especially in Europe, where the week opened with an inflated tonnage list. As additional cargoes emerged, the market found a temporary floor, but competition among owners remained intense.

For larger Handysize units, European round voyages fixed at USD 10,500–12,000 per day, while scrap cargoes to the Mediterranean achieved USD 12,000–13,500 per day. Transatlantic business remained weak, with rates of USD 6,000–7,500 per day.

Mediterranean conditions deteriorated further due to thin demand and rising vessel availability, intensifying downward pressure on freight levels. In contrast, the U.S. Gulf maintained a relatively stable flow of cargoes and tonnage. Larger Handysize vessels fixed at USD 15,000–16,500 per day for transatlantic voyages and USD 14,500–16,000 per day for Asia-bound runs.

In ECSA, activity was brisk, with a high volume of fixtures, albeit at lower levels compared to previous weeks. Rates for transatlantic voyages to Europe and the Mediterranean settled at USD 16,000–17,500 per day, while Asia-bound cargoes fixed at USD 16,500–18,000 per day.

Asian markets remained under pressure, dominated by vessel oversupply across both northern and southern regions. Smaller Handysize units felt the greatest strain. In the Arabian Gulf and Indian subcontinent, conditions were quiet, with little change anticipated ahead of the Lunar New Year. Round voyages in the Far East and NOPAC fixed at USD 7,500–9,000 per day, while Southeast Asia–China business achieved USD 11,000–12,500 per day.

Outlook: Slow Steaming Into Uncertainty

The dry bulk market is currently navigating through a period of cold weather and low visibility. Freight rates remain compressed, tonnage availability is ample, and cargo demand has yet to provide a convincing catalyst for recovery. While isolated regions continue to show resilience, the broader picture points to a market moving cautiously, waiting for clearer signals before committing to higher speed.

As history has often shown, the balance can shift quickly. For now, however, owners and charterers alike are proceeding with restraint—slow steaming through uncertain waters, alert for the next change in wind direction.

Legal Disclaimer:

This report is provided solely for general informational purposes and does not constitute investment or commercial advice. The information herein is based on sources believed to be reliable but is not guaranteed for accuracy or completeness. Any actions taken based on this content are the sole responsibility of the reader.